KABUL — Afghanistan on Monday dismissed a claim by Tehran that the two countries had reached an agreement for Iran to supply all of its private sector fuel, drawing out a long-running dispute between the neighbours.

Ghulam Mohammad Aylaqi, deputy commerce minister, denied comments made Sunday by Iranian Oil Minister Masoud Mirkazemi that an agreement was made under which the private sector would buy "all its needed products" from Iran.

Aylaqi said Kabul could not afford such a deal with Iran.

"We have offered to buy the (fuel) needs of western and southwestern Afghanistan (from Iran). We have not agreed and will not agree to buy all our supplies from Iran," Aylaqi said.

He added that it was not viable to buy from Iran for north and east Afghanistan because imports from nearby central Asia and Pakistan were cheaper.

About one third of Afghanistan's fuel needs, imported from Russia, Turkmenistan and Iraq, transit through Iran.

The transport of the fuel has become a sensitive issue as the Islamic republic has prevented the passage of trucks carrying the supplies to Afghanistan.

Thousands of fuel trucks were left stranded on the Afghan-Iranian border in a dispute between the two sides over fuel earlier this year although the backlog has now been largely cleared.

Tehran has hinted to Kabul that it suspected the fuel in the trucks would be used to supply US and other foreign troops fighting a Taliban insurgency in Afghanistan.

Finance Ministry spokesman Aziz Shams also said Afghanistan could not afford to import all its fuel supplies from Iran.

"We have never agreed to purchase all our fuel from Iran. We can't do that," he told AFP.